Back in March, 500 Startups announced that it was entering the Canadian market through a $30 million fund focused on early-stage ventures. Just under a year later, 500 Canada has announced that it has closed $15 million of that fund.
Investors in the close include Globalive Capital, W Investments, and TWG, as well as a number of private investors. Prior to the announced close, the 500 Canada team has already made co-investments in companies like AmpMe, Avidbots, Element.AI, Mejuri, Motorleaf, and Synervoz.
“We find companies that have some possibility to success, invest in a lot of them, and then as they demonstrate some success double down.”
– Sanjay Singhal,
Led by Sanjay Singhal, 500 Canada has grown its investment team across Canada, including partners like former MaRS investment manager Neha Khera in Toronto, iStockphoto co-founder Patrick Lor, former Bandzoogle CEO David Dufresne, and angel investor Mike Cegelski.
“Sanjay and Neha are very pragmatic which makes for stress-free communication,” said Jim Rand, CEO of Synervoz. “They share our vision and focus strictly on relevant questions that aim to ensure our vision becomes reality. We’re excited to finally be getting looped in with the rest of the team too — everyone here is awesome!”
Speaking with BetaKit at the time, Singhal said that the 500 Canada fund is looking for startups with a $2 million to $10 million valuation with co-founders, and lean capital requirements. He also said the fund would ambitiously aim to invest in one startup a week.
“500’s model is based on massive diversification, though there’s a notion that 500 is ‘spray and pray’. That comes from a foundational of lack of understanding of our portfolio theory,” Singhal said. “Traditional venture is that we’re smarter than you, so we’re going to invest in six to eight companies a year, manage the hell out of them, and then make them successful…we find companies that have some possibility to success, invest in a lot of them, and then as they demonstrate some success double down on them.”
500 Canada will also co-invest alongside many of the companies accepted into the 500 Startups seed programs in San Francisco and Mountain View. The seed program invests $200,000 ($150,000 USD) in exchange for six percent equity, and charges a $50,000 ($37,500 USD) fee for the program. In its most recent batch, 500 Canada invested in Canadian companies like Hykso, InnerSpace, and Homigo.
“We have a great team, an amazingly talented pool of entrepreneurs, and all the global resources of 500 Startups behind us,” said Singhal. “Early stage startups in Canada are about to get rear-ended by the Millennium Falcon.”
Feature photo by Yiying Lu